Loyalty programs encourage consumers to make purchases with a particular brand or merchant by offering various forms of incentive. Consumers can accumulate points and/or rewards based on purchases made with the brand or merchant. For example, consumers may be entitled to a discount on a current purchase (5% off). According to another example, consumers may accumulate points based on a points system where points translate into some type of reward. Some programs may implement a tier system to reward initial loyalty and encourage more purchases. Loyalty programs effectively increase customer loyalty, retention and brand recognition.
In some instances, consumers do not perceive their rewards program to be particularly useful or valuable primarily because many points go unused. Oftentimes, a consumer will enroll to take advantage of the initial benefit (e.g., 25% off entire purchase with a new account) but falls short of accumulating enough points to experience a cash benefit. Some loyalty programs require a high threshold to receive any sort of reward (e.g., 20,000 points required to receive a $20.00 gift card). As a result, consumers are unable to enjoy the benefits of a loyalty program and thereby lose interest. Accordingly, the benefits of a loyalty program are not realized and customer loyalty is not achieved.
These and other drawbacks exist.